Weak pound and Euro 2016 boost Paddy Power Betfair
IRISH bookmaker Paddy Power Betfair has raised its full-year profit forecast after it was boosted by the collapse in sterling and the Euro 2016 football championships in the third quarter.
The company, born out of a merger between Paddy Power and Betfair, saw revenue rise 25 per cent to £404 million in the three months to September 30.
Paddy Power Betfair said it benefited to the tune of £28 million from the translation of non-UK revenues due to the weakness of sterling.
On a constant currency basis, turnover grew 15 per cent. Underlying earnings were up 53 per cent to £113 million in the quarter and the group said it now expects underlying earnings for the full year to come in between £390 million and £405 million, against previous expectations of £365 million to £385 million.
Chief executive Breon Corcoran said: "This was another good quarter for Paddy Power Betfair. We are continuing to focus on building a stronger combined operation by exploiting the unique assets and capabilities of each legacy business, and on using our scale to better serve our customers.
"Work is under way to combine the best of Betfair and Paddy Power's technology into a multi-brand, multi-channel, multi-jurisdictional platform that will start to unlock the full potential of the group's scale and will lead to increased pace of development and faster roll out of new products."
Joshua Raymond, market analyst at XTB.com, said: "The firm is seeing higher synergy cost savings with Betfair, which married with a good third quarter means they are upgrading their EBITDA guidance for the full year to between £390m and £405m - an increase from previous guidance of £365m to £385m.
"Paddy Power is one firm to benefit from the weak sterling, with its euro-denominated sales resulting in a £28m uplift in sales thanks to the weak pound. Shareholders should like this report.”